Exercise 5-12 (Algo) Multiproduct Break-Even Analysis [LO5-9] Olongapo Sports Corporation distributes two premium golf balls-Flight Dynamic and Sure Shot. Monthly sale margin ratios for the two products follow: Sales CM ratio. Product Flight Dynamic $ 720,000 68% Sure Shot $ 280,000 79% Total $ 1,000,000
Exercise 5-12 (Algo) Multiproduct Break-Even Analysis [LO5-9] Olongapo Sports Corporation distributes two premium golf balls-Flight Dynamic and Sure Shot. Monthly sale margin ratios for the two products follow: Sales CM ratio. Product Flight Dynamic $ 720,000 68% Sure Shot $ 280,000 79% Total $ 1,000,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Exercise 5-12 (Algo) Multiproduct Break-Even Analysis [LO5-9]
Olongapo Sports Corporation distributes two premium golf balls-Flight Dynamic and Sure Shot. Monthly sales and the contribution
margin ratios for the two products follow
Sales
CM ratio.
Product
Flight Dynamic
$ 720,000
68%
Fixed expenses total $588,000 per month.
Sure Shot
$ 280,000
79%
Total
$1,000,000
Required:
1. Prepare a contribution format income statement for the company as a whole.
2. What is the company's break-even point in dollar sales based on the current sales mix?
3. If sales increase by $52,000 a month, by how much would you expect the monthly net operating income to increase?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa880cc3d-71b2-44bc-9eb8-ccb18aa2c0ed%2F5f40d5eb-5410-40ad-af21-c7459b52677c%2Fvx88swk_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Exercise 5-12 (Algo) Multiproduct Break-Even Analysis [LO5-9]
Olongapo Sports Corporation distributes two premium golf balls-Flight Dynamic and Sure Shot. Monthly sales and the contribution
margin ratios for the two products follow
Sales
CM ratio.
Product
Flight Dynamic
$ 720,000
68%
Fixed expenses total $588,000 per month.
Sure Shot
$ 280,000
79%
Total
$1,000,000
Required:
1. Prepare a contribution format income statement for the company as a whole.
2. What is the company's break-even point in dollar sales based on the current sales mix?
3. If sales increase by $52,000 a month, by how much would you expect the monthly net operating income to increase?
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